Flexibility is a benefit enjoyed often by small companies, but rarely by large ones. Like a small boat, businesses still in early stages can maneuver quickly; they can alter business plans, tweak messaging, and otherwise pivot without having to worry about re-orienting a large workforce or undermining the public’s understanding of the brand. By contrast, large businesses operate more similarly to a container ship. Every move requires extensive planning, communication, and extreme foresight. Fine-tuning a product can take months, and changing direction entirely can take years.
Car manufacturers are among the largest businesses in the world. So for all of the political bluster surrounding the EPA, clean-air regulations, and efficiency mandates, it should come as little surprise to see automakers’ focus still locked on improving the fuel economy of their products. Pivoting back toward high-margin Hummers simply isn’t practical when the window of opportunity may last only four years.
The latest newspapers may be filled with headlines about budget cuts for the EPA and rollbacks to emissions regulations, but dealership lots should still be well-stocked with hybrid and electric vehicles. Which of those vehicles ends up in the most driveways, however, is yet to be seen.
Since landing in America in 2000, the Toyota Prius has crept closer and closer to generic trademark status, although the term “hybrid,” not quite a neologism two decades ago, has managed to remain heavily in use thanks to what light competition the Prius has had since its debut.
Colloquialisms aside, “Prius” may as well be synonymous with “hybrid.” When Toyota expanded the Prius family to include the v, c, and Plug-in models in 2012, total sales of the nameplate skyrocketed toward 250,000 per year. Compare that figure to those of the best-selling non-Prius hybrid of the time—the Toyota Camry Hybrid—and the Prius was the most common hybrid leaving dealership lots by a factor of 10.
Even still, an ever-expanding hybrid market (you can buy a hybrid 2017 Porsche Panamera, for Pete’s sake) has kept generic trademark status at arm’s length for the Prius, and now a new car has arrived with the hopes of putting it out of reach for good.
The 2017 Hyundai Ioniq, which debuted at the 2016 New York International Auto Show, is finally arriving at dealerships, and so far pretty much all news is good news. The new challenger is delivering better fuel economy at 55 mpg city/54 highway/55 combined, compared to the Prius’s 54/50/52. Moreover, the Ioniq is undercutting the Prius in terms of price, too. The Ioniq’s price ranges from $22,200 to $27,500, whereas a Prius will cost you anywhere from $24,685 to $30,015 before you start tacking on options.
To top it off, with the Ioniq, Hyundai is delivering a hybrid vehicle that will blend in seamlessly on the highway. As Toyota relies more and more on polarizing styling to market the Prius, Hyundai hopes the Ioniq will benefit from a design tailored more to the mass market.
In some industries, having a product develop into a generic trademark is something to avoid. Although millions of dollars are spent on marketing and branding, if it works too well, the product’s name can become the standard term for the item, and market protection is lost. Kleenex, for instance, has a brand name that no longer entices shoppers to buy it instead of a competitor’s tissue. In the car market, this isn’t quite the case.
An all-electric Ioniq should arrive eventually, but shoppers needing more than its expected 110-mile range will have limited options. Chief among those is the Chevy Bolt and its 238-mile range. By leveraging a driving range nearly twice that of the current, similarly priced competition and beating its expected rival, the Tesla Model 3, to market, Chevrolet hopes the Bolt will quickly become synonymous with “electric car.”
As Tesla announced that it will need to raise an additional $1.15 billion in order to properly scale before launching the Model 3 sedan, the Chevy Bolt is already seeing capitalism take effect. Dealerships selling the Bolt in more rural areas of California have priced their EVs with markups as high as $5,000 over MSRP, while other, more competitive markets are discounting the Bolt to help move more inventory. Shoppers who can score one of these discounts combined with the federal $7,500 and California $2,500 tax credits may find themselves driving a Bolt off the lot for less than $25,000.
Including the current price of gasoline, challenges abound for cars like the Hyundai Ioniq and Chevy Bolt. Longstanding competition like the Toyota Prius will make winning even a foothold difficult for the Ioniq, and the allure of the Model 3 may keep the Chevy Bolt from taking full control of the electric car market.
Would you rather buy a Hyundai Ioniq or a Chevy Bolt?
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